5 Reasons Why Strategic Alliances Can Sometimes Fail

Written by: Novita, S.Kom, MBA

Strategic alliances occur when two or more people come together for mutual gain. Some alliances are more formal and structured than others. I like to refer to alliances as “projects” with a set time line – rather than an alliance. The expectation with alliances is often that they are open ended and will last forever. This can often be one of the reasons why the alliance does not get off the ground as the participants can be overwelmed with that never ending alliance concept. If the alliance is treated as a project with a start and finish – or a six month trial with this project with a “Let’s see how this alliance/project works for six months” – can often increase the potential results.

T​here are a number of warning signs if your alliances don’t seem to be going anywhere. It might be time for you to do a strategic alliance audit and see if you can identify with any of these warning signs:

1. NO TRUST – allies are reluctant to share ideas and support. This might be due to strangers being grouped together and told to form an alliance. This sometimes happens in organisations where two or more teams are brought together with no mutual connection. Alternately, there is previous negative history that has influenced the lack of trust. To resolve non trust in an alliance, its important to put all the cards on the table – and communicate clearly and succintly towards resolution. e.g. “John, I know that we had our differences when we worked together back in XYZ company. Is there a way we can draw a line in the sand today with this project and move towards a mutual win/win situation? Or should we finish this alliance now and save each other a lot of time and energy?” Sometimes I suggest to clients with a no trust alliance, that they go out for lunch with the allies and get to know each other better. Finding common ground with allies can turn around an alliance that is going nowhere.

2. NO DRIVER – lots of great ideas, but no one actually creating an action plan or moving the alliance forward. Firstly, the problem needs to be put on the table. “We are not getting anywhere with this, what do we need to do to make it happen?” If the project/alliance can be broken down into stages, then people can nominate how involved they wish to be in each stage. And again if there are no volunteers for completion or driving – then its best to dissolve this alliance. Worldwide, there are no shortage of great ideas, but executing a great idea does take a plan and action.

3. NO RESOURCES – Lots of great ideas, but either no time, expertise or money to execute the alliance. A good use of your allies time may be to brainstorm other people who could become involved with your project who may have the expertise or who may sponsor the project on a win/win basis. Also establishing what priority this project has. If it is a number one priority, then are the potential resources being spent on something else? Possibly putting the project on hold for review in 3 or 6 months may unearth more resources.

4. LACK OF CULTURAL AWARENESS – In this global marketplace, this is a “biggie”. Organisations bring in a multi-cultural workforce or international students being brought into a university – without significant cultural diversity training being given to current staff members. This can result in major insults unknowingly happening. When I first started to work within the Asian community in the ’90s, I made many mistakes with business cards and protocol purely through ignorance. Fortunately, I had some wonderful clients who gently pointed out my errors. Yes does not necessarily mean “YES” – it often means I understand you, NOT – I am agreeing to do this. It is worth engaging a multi cultural adviser to either be part of the alliance or highlight for you what is possible and appropriate within this alliance. Again clear communication is critical and apologising sincerely for any previous errors.

5. DIFFERENT VALUES – Beware the cowboys! I describe this potential ally as someone who wants to ride on your coat tails. They are keen to use your organisation’s name and reputation to further their own career. Charities are often targetted by the cowboys, who are full of promises and very elaborate plans, but the bottom line is that YOU and your organisation will not initially gain from this alliance – it at all. The full gain is with the cowboy – who will “use” your database and good will in the marketplace. You will be promised lots of things, but your results are always delayed, and the cowboys are always immediate. Unfortunately, the cowboys do operate an unethical model and move from one unsuspecting ally to another. Trust your gut feeling, if it doesn’t feel right and sounds way too good to be true – it probably is. Do your due diligence on their previous allies and don’t spare their feelings when confronting cowboys about their previous reputation. They will often have a big story about being misunderstood. Bottom line, if in doubt – don’t – no matter how good the offer seems.

Another values area that will definitely lead to failure is dishonesty or not telling the truth. Part of the rules of engagement from the start need to be an agreement for total honesty in all cases – no exceptions. The minute this is abused, the alliance is doomed to failure.

HONESTY = CLEAR COMMUNICATION = RESULTS

And at the end of the day, if you are on the wrong road, you are on the wrong road. If the alliance is not working and you have tried to get it on track without success, cut your losses.

Strategic alliances are a great way to boost your career or business. However, they need time, effort and commitment. The results will be worth it – and if you aim for quality alliances, not quantity -you may find the results astound you.

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